Porsche earnings down a third as German carmakers struggle

PORSCHE’S earnings after tax fell a third, to 2.5 billion euros (S$3.55 billion), in the first nine months of 2024, it said on Wednesday (Nov 13), weighed by the holding’s investments in carmakers Porsche and Volkswagen.

European carmakers are facing multiple hurdles, including high production costs, weak demand, the shift to electric vehicles and fierce Chinese competition.

Carmakers BMW, Mercedes-Benz and Stellantis have all issued profit warnings this year, and Volkswagen has proposed a 10 per cent pay cut for employees and could close plants in Germany to save costs.

Porsche, which also holds shares in German bus service company Flix and Swiss car charger maker ABB E-mobility, said it supported planned cost-cutting at Volkswagen and expected the carmaker to meet its targets.

Porsche holds the majority of ordinary shares in Volkswagen and 25 per cent plus one share of the ordinary shares in Porsche, the firm said.

All of its voting shares are held indirectly by members of the Porsche and Piech families. REUTERS